You just paid the last bill for your first home, and have some money stored away. Now you are beginning to ponder on if it would be a good idea to buy a second home. Whether you are buying to use it (keep it as your own) entirely, or you plan on renting, selling, it is not as crazy as you think. Now that house prices are at an all-time lowest right now, buying a second home, turns out to be a not so wildish dream after all. Now this is an opportunity for all, not just for those belonging to the 1%. For those looking to buy near Laguna Hills, take your time read more.
Consider these factors before the purchase of a second home
- Does it make financial sense? Determine the expenses beforehand. Buyers usually tally up the initial price of the home, but not the additional fees. Expenses such as repairing, repainting, etc. Consider this sign to incrementing your money piggy bank, and if you are planning to rent out the property think the monthly income, as sometimes it is not sufficient to cover bills.
- Select type and location. Choose the location wisely, as a poorly placed home will not serve its purpose. A family, vacationer, won´t enjoy it, renting or selling will become a tougher task, and so on. Remember always to check your surroundings before making a choice, consider other people´s opinions, perhaps even appeal to individual buyers. The same is said for the type of the house. Choosing between a condo, co-op property or simple home, all have different necessities when it comes to taking care of them. If you are planning to rent it, then this won´t become such a hassle. Keep in mind these two factors when picking to buy a second home.
- Check tax implications. Owning a second home means worrying about property taxes (all of them which vary state by state). For this step, it is desirable to take your time and plan in advance (preferably during the house-hunting process), doing so could save you thousands of dollars.
- Financing. When preparing to own a second home, without a doubt, you´ll need cash and lots of it. Many buyers pay for their home combining both, a down payment and a loan. The more money in your initial payment, the less you´ll need the loan.
- Non-traditional financing. A second home is no easy task; thus you´ll be in need of cash, to pay the mortgage, and related housing bills. Do not be shy to ask your family and friends for some money, when in need. Also take a look into co-ownership, as it is a rising trend. It just consists on willing to own property, splitting the payments with another person, making it a shared home. Perfect options for beach houses is you think about it.
- Invest in protecting your second home. Protection comes before the buying phase and continues long afterward. Consider getting a home inspection, as a way to deduct any fixing costs. Also, protect your home with the many different insurance policies there are, covering a broad range of scenarios (theft, natural disaster issues).
Clearly, the acquisition of a second home is one that requires lots of thought and planning, Remember to solve any doubts before hand.